Tesla is reportedly expanding its global battery supply network once again, as the automaker looks to reduce costs and increase control over one of the most critical components in its electric vehicles (EVs).
According to a report by Chinese media outlet 36kr, the battery maker has become Tesla’s fifth global cell supplier, joining established partners like CATL, Panasonic, LG Energy Solution, and BYD.
The report suggests the new batteries are already being shipped from Sunwoda’s facility in Yiwu, China, and are being installed in vehicles built at Giga Shanghai. For now, those vehicles are destined for export markets, with no confirmation yet on when, or if, Sunwoda cells will be used in cars sold within China.
Unlike Tesla’s longstanding arrangement with CATL, where complete battery modules are often supplied, this partnership appears to follow a different model. Tesla is reportedly sourcing only the battery cells from Sunwoda, while handling module and pack assembly in-house.
This gives Tesla more direct control over manufacturing, potentially improving efficiency while lowering production costs.
The cells themselves are said to use third-generation lithium iron phosphate (LFP) chemistry, supporting charging rates of up to 3C. The “C-rate” measures how quickly a battery can be charged relative to its capacity — with 1C representing a full charge in one hour. A 3C rate means the battery can theoretically charge in about 20 minutes under ideal conditions, highlighting a significant step forward in fast-charging capability.
Battery costs remain a major factor for Tesla. Estimates suggest they account for more than 30% of a vehicle’s total cost, and with automotive margins tightening in recent years, expanding the supplier base could give Tesla greater leverage in pricing negotiations. It also reduces reliance on any single supplier, particularly in China where CATL has long been dominant.
However, Sunwoda’s addition is not without some risk. The company currently ranks outside the top tier of global battery manufacturers and has recently faced scrutiny over quality issues, including recalls linked to batteries supplied for vehicles like the Volvo EX30 and Zeekr 001. It has also been involved in a legal dispute with Geely, though reports indicate that matter has since been settled.
Still, Tesla is known for taking a measured approach when onboarding new suppliers. With Tesla there is typically an evaluation period of around a year before broader deployment, which could explain why Sunwoda’s batteries are currently limited to export vehicles.
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